Boston Scientific Corp (BSX)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 5,257,000 | 4,345,000 | 4,003,000 | 3,760,000 | 3,510,000 |
| Inventory | US$ in thousands | 2,810,000 | 2,484,000 | 1,867,000 | 1,610,000 | 1,351,000 |
| Inventory turnover | 1.87 | 1.75 | 2.14 | 2.34 | 2.60 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $5,257,000K ÷ $2,810,000K
= 1.87
The inventory turnover ratio measures how efficiently a company manages its inventory by showing how many times the company sells and replaces its inventory during a specific period.
In the case of Boston Scientific Corp, the inventory turnover has been as follows:
- December 31, 2020: 2.60
- December 31, 2021: 2.34
- December 31, 2022: 2.14
- December 31, 2023: 1.75
- December 31, 2024: 1.87
The decreasing trend in the inventory turnover ratio indicates that Boston Scientific Corp is taking longer to sell its inventory over the years, which may suggest potential inefficiencies in inventory management. A lower inventory turnover ratio can imply excess inventory levels or slow-moving inventory, leading to increased carrying costs and potentially obsolete inventory issues.
It is essential for Boston Scientific Corp to closely monitor its inventory turnover ratio and take actions to improve inventory management practices, such as optimizing inventory levels, streamlining supply chain processes, and identifying slow-moving items to enhance profitability and operational efficiency.
Peer comparison
Dec 31, 2024